Larkland Company acquired 30% of the voting stock of Martin Corporation on January 2, 2020 for $50 million. The basis difference was attributed to goodwill. During 2020, Martin Corporation reported net income of $5,000,000, other comprehensive income of $150,000, and declared and paid cash dividends of $2,000,000. Larkland uses the equity method to report its investment in Martin.
Required a. Prepare Larkland's 2020 journal entries related to its investment in Martin.
b. Calculate the balance in Investment in Martin, appearing on Larkland's December 31, 2020 balance sheet.

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The Answer of Larkland Company acquired 30% of the voting stock of Martin Corporation on January 2, 2020 for $50 million. The basis difference was attributed to goodwill. During 2020, Martin Corporation reported net income of $5,000,000, other comprehensive income of $150,000, and declared and paid cash dividends of $2,000,000. Larkland uses the equity method to report its investment in Martin.
Required a. Prepare Larkland's 2020 journal entries related to its investment in Martin.
b. Calculate the balance in Investment in Martin, appearing on Larkland's December 31, 2020 balance sheet.

Larkland Company Acquired 30% of the Voting Stock of Martin